6 Dividend Stocks Using Cash To Pay Higher Dividends

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The Boston Consulting Group doesn’t discount the role that stock buybacks can play in boosting near-term returns for some companies. But the firm’s research indicates that stock buybacks do not change investors’ estimates for long-term earnings-per-share growth, or induce them to accord a company a higher valuation multiple. By contrast, it says, dividend growth has a far more positive long-term impact.

Below are several companies that recently used cash to increase dividends paid to their shareholders:

Artesian Resources Corporation (ARTNA) provides water, wastewater, and engineering services on the Delmarva Peninsula. September 28th the company increased its quarterly dividend 1.5% to $0.0.1930 per share. The dividend is payable on November 23, 2011 to shareholders of record at the close of business on November 11, 2011. The yield based on the new payout is 4.7%.

Atlantic Tele-Network, Inc. (ATNI) provides telecommunications services to rural, niche, and other under-served markets and geographies in the United States, Bermuda, and the Caribbean. September 28th the company increased its quarterly dividend 4.5% to $0.23 per share. The dividend is payable on October 14, 2011, to stockholders of record as of October 7, 2011. This is the thirteenth consecutive annual increase in the Company's dividend. The yield based on the new payout is 2.9%.

Comtech Telecommunications Corp. (CMTL) engages in the design, development, production, and marketing of products, systems, and services for communications solutions. September 27th the company increased its quarterly dividend 10% to $0.275 per share. The dividend is payable on November 22, 2011 to shareholders of record at the close of business on October 21, 2011. The yield based on the new payout is 4.0%.

Hickory Tech Corporation (HTCO) provides integrated communications services to business and residential customers in the Midwest. September 26th the company increased its quarterly dividend 4% to $0.14 per share. The dividend is payable on Dec. 5, 2011 to shareholders of record on Nov. 15, 2011. The yield based on the new payout is 6.1%.

ConAgra Foods, Inc. (CAG) operates as a food company primarily in North America. It operates in two segments, Consumer Foods and Commercial Foods. September 23rd the company increased its quarterly dividend 4% to $0.24 per share. The dividend is payable on on Dec. 1, 2011, to stockholders of record at the close of business on Oct. 31, 2011. The yield based on the new payout is 4.0%.

Covidien Public Limited Company (COV) develops, manufactures, and sells healthcare products for use in clinical and home settings. September 22nd the company increased its quarterly dividend 12.5% to to $0.225 per share. The dividend is payable Nov. 4 to shareholders as of Oct. 13. The yield based on the new payout is 1.9%.

Selecting stocks with increasing dividends is critical for an income growth strategy. The above list contains stocks that recently raised their dividends; it is not a list of recommend buys. As always, due diligence should be performed before buying or selling any stock. For a list of stocks with a long string of consecutive cash dividend increases, see this list.